States With No Income Tax Hit Jackpot

Three states with no individual income tax experienced the highest gains in total tax revenue between 1990 and 2000, according to Census Bureau figures.

The three states are New Hampshire, where tax revenues rose 58 percent; Alaska, with a 57 percent increase; and Wyoming, at 19 percent.

Across the nation, state tax revenues grew to $540 billion in 2000 -- an increase of 8 percent over the $500 billion collected in 1999.

In general, states receive most of their tax income from occupational and business licenses, income taxes, and so-called "severance revenues" - i.e., taxes on non-renewable resources such as oil, gas and coal.

Revenues from such sources as license fees were up 16 percent, and income tax revenues climbed 13 percent.

Severance revenues in the 36 states that impose such taxes were up 39 percent.

Ryan Horn of Americans for Tax Reform speculates on the reasons the three no-income-tax states fared so well. He points out that income taxes come from wages and salaries, corporate profits and capital gains -- sources that have been vulnerable to the economic slowdown. On the other hand, real estate prices and consumer spending -- which form the base for property and sales taxes -- have continued to be strong.